Inflation Hit Iceland Hard. Even Its Beloved Hot Dogs.

Iceland is an expensive place to eat. This country in the North Atlantic depends on imported food, and inflation has been raging for years despite the government’s efforts to tame it.

But even though food prices are high, most Icelanders can still afford a hot dog.

“Everyone eats it, rich or poor,” said Gabriel Máni De Sousa, 16, fixing his hairnet behind the counter of Pylsubarinn, a decades-old hot-dog stand south of Reykjavik, where he works weekends.

Then he started making “one with everything,” the local way — with both raw and fried onions between the meat and the bun, and a healthy squirt of ketchup, sweet brown mustard and a rémoulade on top. Usually made with a blend of three meats — Icelandic lamb and beef as well as some imported pork — the dogs have a real snap, followed by a burst of juice that could shame their American peers.

If Iceland had a national dish, it would be the hot dog. It’s akin to the dollar slice, that emblem of affordable New York City eating: hot, reliable and better than it needs to be.

But even Iceland’s hot dogs are not immune to inflation.

Prices vary depending on the stand and the toppings. But for the most part, a standard dog costs about 750 Icelandic krona, around $6. That is low for the Reykjavik area, where a kebab can cost $17 and dinner-plate-sized pizza can be $20. Consumer prices were 5.2 percent higher last month than in February 2025 — that’s more than twice that of the European Union. Hot dog prices have followed, steadily increasing at stands across the country.

Bæjarins Beztu Pylsur — the most famous hot dog shop in Iceland, whose name translates to “The Town’s Best Hot Dogs” — has been selling in downtown Reykjavik since at least the 1930s, and expanded rapidly in recent years from four to 14 locations.

Baldur Ingi Halldorsson, the chief executive, said he has raised prices more in the past few years than in the previous 20. In 2022, the price was 600 krona (about $4.80); now, it’s 880 krona, or just over $7. Inflation has increased ingredient costs and wages have gone up, so the cost of running a business is higher.

He joked that his goal is to stay out of the headlines, which doesn’t always work.

“People are angry with us — because we’re always raising prices,” he said. “We’re usually always on the news when we raise the price.”

Jakob Hjalmar Konradsson and Krista Maria Finnbjornsdottir, proud hot dog obsessives, have noticed. He used to bring vacuum-sealed hot dogs with him when he lived abroad in Norway and Sweden. Her mother sent her some when she studied in Britain.

“They’re very addictive,” said Ms. Finnbjornsdottir, 28.

“Nothing else compares to it,” agreed Mr. Konradsson, 30.

They eat several Bæjarins Beztu hot dogs a week. The couple started reminiscing about how cheap prices were in their childhood — 350 krona for a hot dog and a soda, he said, or under $3.

“It’s very classic to get a hot dog and complain about the price,” Mr. Konradsson joked.

Icelanders have long eaten a lot of lamb, often in sausage form, partly influenced by Danish rule. (An old joke is that the sheep outnumber the people. That was true until recently, when the human population finally overtook the sheep population.)

When American troops showed up in the 1940s, they brought their fast-food culture with them. Solveig Olafsdottir, a historical researcher at the University of Iceland who studies food history and culture, said the Red Cross set up hot-dog stands, which became one of the main places where Icelanders and Americans met.

“Hot dogs became like a sign of modernity,” Ms. Olafsdottir said.

For decades, even after the Icelandic sausage became the Icelandic hot dog, it was still a cheap option for a country on the go.

Many Icelanders grab them at gas stations because they’re a one-handed snack suitable for eating while driving — an essential draw in a place without either robust public transit or weather suited for regular biking or walking. Tourists also rely on them in the more remote parts of Iceland, where they are the go-to hot food at gas stations during trips around the country’s ring road.

Over the last 20 or so years, the hot dog became a meme — an essential part of the Icelandic tourist brand. And Bæjarins Beztu became a destination.

In 2004, Bill Clinton visited the stand. (In a bout of shocking sausage sacrilege, at least in Iceland, the former president skipped the toppings and ordered a dog with only mustard. Now, at Bæjarins Beztu, that’s called “the Clinton.”)

The next year, Anthony Bourdain visited during his first season of “No Reservations.” Late at night, he got “one with everything.”

By 2006, when The Guardian listed the stand on a ranking of the best food stalls in Europe, its fate was sealed. Lines of tourists lengthened outside waiting to photograph, and often only then taste.

Soon, savvy chefs started serving riffs on the standard fare.

The very literally named Icelandic Bar serves three takes on the standard hot dogs, which cost between $21 and $25 each. One is made with shredded lamb (from Iceland) and Béarnaise sauce. Another, with reindeer meatballs (the meat is imported from Finland) and blueberry syrup. The third, and most famous, has chunks of fried lobster. That, they get from Norway.

Last year, the bar sold about 13,000 of the lobster dog, said Sverrir Ljar Bjornsson, the manager. He has had to raise prices, too, as salaries go up. And even he’s feeling the pinch. He wants to feed his three children healthy food, but sometimes, they stop for a dog. When they do, he said, he’s been shocked by the increasing prices.

“It’s annoying going out to eat in Iceland,” he said.

The frills, though, are mostly just for tourists. Outside of the boutique-congested heart of Reykjavik, hot dogs are just hot dogs.

They’re a snack for rowdy teenagers. A filling drive-through meal for construction workers coming home from work. A nostalgic father-daughter celebration after a hard-fought swim meet.

They can also be something of a necessity.

“It’s the cheapest food I can get,” said Skuli Fjeldsted Baldursson, 71, a retired teacher, speaking through bites of a hot dog on a recent Sunday at lunch time.

Mr. Baldursson doesn’t like to cook, but the cost of a regular sit-down restaurant meal would be prohibitive. So this was a bit of an indulgence.

“Everything is expensive,” he said, hunched against the cold at a picnic table outside a stand, his breath steaming. “Prices are getting higher and higher.”

Follow New York Times Cooking on Instagram, Facebook, YouTube, TikTok and Pinterest. Get regular updates from New York Times Cooking, with recipe suggestions, cooking tips and shopping advice.

Egill Bjarnason contributed reporting from Husavik, in northern Iceland.